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4/22/2011 8:00:00 AM Write a Letter to the Editor Write a letter to the Editor

Opinion: Passing Through the Patent ‘Troll’ Booth

By Kevin Bell and Richard Oparil

Patent Litigation Partners

Patton Boggs LLP

This Opinion piece appears in the April 18 print edition of Transport Topics. Click here to subscribe today.

PJC Logistics LLC, a company based in Hewitt, Texas, recently launched an attack on the trucking industry by filing nine lawsuits for patent infringement in federal courts around the country, naming 237 transportation companies as defendants and alleging infringement of U.S. Patent 5,223,844 — also known as the “844 Patent” — which is titled “Vehicle Tracking and Security System.” The allegation of infringement against each defendant was based on its use of “electronic position-based fleet management and tracking systems in its fleet of trucks, vans or other vehicles.”

To members of an industry not accustomed to being accused of infringing a patent they didn’t know existed, PJC Logistics’ allegations seemed frivolous and incomprehensible. As one company executive asked during a recent series of presentations conducted by members of our firm, “You’re telling me that I can be sued for patent infringement for something I bought and paid for?”

The answer is yes, if the person you bought it from did not have a license to the patent being asserted against you.

The question asked more frequently by all the defendants is, “Who does something like this?” The answer is: a “patent troll” — a company that invents nothing itself, instead buying patents from others for the sole purpose of suing businesses to obtain money. And the warning is: Get used to it.

As technologies are implemented and improved in various industries, companies are at an increased risk of being sued for patent infringement. This is particularly true as federal or state regulators move to require companies to use electronic tracking or other technology.

Patent trolls prefer quick money settlements and are almost always represented by attorneys working on a contingent fee basis. Defendants who settle early once run the risk of becoming an easy mark for the next troll. In fact, some defendants already have faced patent litigation filed by ArrivalStar SA — a company with a similar business model to PJC Logistics that our firm is litigating against actively.

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